Advertising and Product Quality Relationship with Sales.
The presenting a very interesting discussion of advertisers’ attempts to measure the value of advertising through ROI (return on investment). The lead-in serves as an interesting topic for discussion, as marketers (probably forever) have debated the value of advertising expenditures and their ROI. It is setting good objectives can be complex and difficult, it’s important for promotional decisions are made. The specific advertising and promotional guiding the development of the promotional program and measuring its effectiveness. Part of the problem stems from the fact that many marketers are uncertain as to what advertising and promotion can or should do and/or prefer to use sales as an objectives.
One of the reasons many companies fail to set specific objectives for their advertising and promotional programs is that they fail to recognize the value of doing so. There are several important reasons for setting advertising and promotional objectives:
Communication – Specific objectives serve as communication devices and the coordination of the various groups working on the campaign on both the agency and the client side. Problems can be avoided if all parties involved have a set of written and approved objectives to guide their decisions and actions.
Planning and Decision Making – Specific objectives can be useful as a guide or criterion for decision making. Advertising and promotion planners are often faced with a number of strategic and tactical options in areas such as creative, media, budgeting and sales promotion. Choices among these options should be made on the basis of how well a strategy or tactic matches the promotional objectives.
Measurement and Evaluation of Results – A very important reason for setting specific objectives is that they provide benchmark or standard against which success or failure of the campaign can be measured. When specific objectives are set it becomes easier for management to measure what has been accomplished by the campaign.
Marketing is an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customers and for managing customer relationships in ways that benefit the organization.
Customer Relationship Management (CRM).
The new definition of Marketing developed by the AMA. It also shows the some of the key aspects of marketing which include creating, communicating and delivering value, the focus on customer relationships, using mass customization to deliver products and services in response to specific customer needs, and customer relationship management (CRM) which involves the systematic tracking of customers’ preference and behavior and adjusting the marketing program to meet their needs.
|“A direct inducement that offers an extra value or incentive for the product to the sales force, distributors, or the ultimate consumer with the primary objective of creating an immediate sale.”|
|An extra incentive to buy.||A tool to speed up sales.|
|Targeted to different parties|
There are three important aspects of sales promotion:
Extra – Incentive to buy Coupons, rebates, premium provide extra reason to buy.
Tool to speed up sales – acceleration tool designed to shorter the purchase cycle.
Targeted to different parties – Can be targeted to consumers or to the trade.
Attention should be given to these three important aspects of sales promotion.
5. Integrating Marketing Communication (IMC):
Integrated marketing communication is a strategic business process used to plan, develop, execute and evaluate coordinated, measurable, brand communications programs over time with consumers, customers, prospects, employees, associates, and other targeted relevant external and internal audiences.
The goal is to generate both short-term financial returns and build long-term brand and shareholder value.
Advertising is a defined as any paid form of non personal communication about an organization, product, service, or idea by an identified sponsor.
6.1 Classification of Advertising:
Advertising to Consumer Markets
National Advertising – Done by large companies on a nationwide basis. Ads for well-known brands and companies shown on television are an example.
Retail/Local Advertising – Done by retail and local merchants encouraging consumers to shop at a specific store, use a local service, or patronize a particular establishment.
Primary-verses Selective-Demand Advertising – Primary demand advertising is designed to stimulate demand for the general product class or industry. Selective-demand focuses on creating demand for a specific company and/or its brands.
Advertising to Business and Professional Markets
Business-to-Business Advertising – Advertising that targets individuals who buy or influence the purchase of industrial goods or services for their companies.
Professional Advertising – Advertising targeted to professionals such doctors, lawyers, engineers, and the like.
Trade Advertising – Targeted to marketing channel members such as wholesalers, distributors, and retailers.
6.2 Profiles of Major Media Types:
|Newspapers||Flexibility; timeliness; good local market coverage; broad acceptability; high believability.||Short-life; poor reproduction quality; small pass-along audience.|
|Television||Good mass-market coverage; low cost per exposure; combines sight, sound, and motion; appealing to the senses.||High absolute costs; high clutter; fleeting exposure; less audience selectivity.|
|Direct Mail||High audience selectivity; flexibility; no ad competition within the same medium; allows personalization.||Relative high cost per exposure, “junk mail” image.|
|Radio||Good local acceptance; high geographic selectivity; low cost.||Audio only, fleeting exposure; low attention (“the half-heard” medium); fragmented audiences.|
|Magazines||High geographic and demographic selectivity; credibility and prestige; high-quality reproduction; long life and good pass-along readership.||Long ad purchase lead time; high cost; no guarantee of position.|
|Outdoor||Flexibility; high repeat exposure; low cost; low message competition; good positional selectivity.||Little audience selectivity; creative limitations.|
|Yellow Pages||Excellent local coverage; high believability; wide reach; low cost.||High competition; long ad purchase lead time; creative limitations.|
|Newsletters||Very high selectivity, full control; interactive opportunities; relative low costs.||Cost could run away.|
|Brochures||Flexibility; full control; can dramatize messages.||Overproduction could lead to run away costs.|
|Telephone||Many users; opportunity to give a personal touch.||Relative high cost unless volunteers are used.|
|Internet||High selectivity; low cost; immediacy; interactive capabilities.||Small, demographically skewed audience; relatively low impact; audience controls exposure.|
A product is anything that can be offered to a market to satisfy a want or need. Products that are marketed include physical goods, services, experiences, events, persons, properties, organizations, information, and ideas.
7.1 Product Classifications:
Marketers have traditionally classified products on the basis of characteristics: durability, tangibility, and use (consumer or industrial). Each product type has an appropriate marketing-mix strategy.
7.2 Durability and Tangibility
Products can be classified into three groups, according to durability and tangibility:
Nondurable goods: Nondurable goods are tangible goods normally consumed in one or a few uses: soap and paste. Because these goods are consumed quickly and purchased frequently, the appropriate strategy is to make them available in many locations, charge only a small markup, and advertise heavily to induce trial and build preference.
Durable goods: Durable goods are tangible goods that normally survive uses: shows, machine tools and clothing. Durable products normally require more personal selling and service, command a higher margin, and require more seller guarantees.
Services: Services are intangible, inseparable, variable, and perishable products. As a result, they normally require more quality control, supplier credibility, and adaptability. Examples include haircuts and repairs.
7.3 Consumer – Goods Classification:
The vast array of goods consumers buy can be classified on the basis of shopping habits. We can distinguish among convenience, shopping, specialty, and unsought goods.
Convenience goods are goods that the customer usually purchases frequently, immediately, and with a minimum of buying effort. Examples include tobacco products, soaps and newspapers.
Convenience goods can be further divided. Vegetable are goods consumers purchases on a regular basis. A buyer might routinely purchase food, Colgate toothpaste, Lux soap. Aanondolok magazine is purchase. Emergency goods are purchased when a need is urgent – umbrellas during a rainstorm, boots and shovels during the first winter snowstorm. Manufacturers of emergency goods will place them in many outlets to capture the sale when the customer needs them.
Shopping goods are goods that the customer, in the process of selection and purchase, characteristically compares on such bases as suitability, quality, price, and style. Examples include furniture, clothing.
Shopping goods can be further divided. Homogeneous shopping goods are similar. In quality but different enough in price to justify shopping comparisons. Heterogeneous shopping goods differ in product features and services that may be more important than price. The seller of heterogeneous shopping goods carries a wide assortment to satisfy individual tastes and must have well-trained sales people to inform and advice customers.
Specialty goods are goods with unique characteristics or brand identification for which a sufficient number or buyers is willing to make a special purchasing efforts. Examples include exclusive dresses, men’s suits, and mobile sets.
A mobile sets is a specialty good because interested buyers will travel far to buy one. Specialty goods don’t involve making comparison; buyers invest time only to reach dealers carrying the wanted products. Dealers don’t need convenient locations; however, they must let prospective buyers know their locations.
Unsought goods are goods the customers doesn’t know about or doesn’t normally think of buying. Smoke detectors are unsought goods until the consumer is made aware of them through advertising. The classic examples of known but unsought goods are life insurance, cemetery plots, gravestones, and encyclopedias.
Unsought goods require advertising and personal-selling support.
7.4 Industrial – Goods Classification:
Industrial goods can be classified in terms of how they enter the production process and their relative costliness. We can distinguish three groups of industrial goods: materials and parts, capital items, and supplies and business services.
Materials and parts are goods that enter the product completely. They fall into two classes: raw materials and parts manufacturer’s.
Raw materials fall into are two major classes: farm products (e.g., wheat, cotton, fruits, and vegetables) and natural products: natural products (e.g., fish, lumber, crude petroleum, iron, ore). Farm products are supplied by many producers, who turn them over to marketing intermediaries, who provide assembly, grading, storage, transportation, and selling service. Their perishable and seasonal nature gives rise to special marketing practices. Their little advertising and promotion activity, with some exception. At times, they will launch campaigns to promote their product – potatoes, milk. Some producers brand their product – oranges, bananas.
Natural products are limited in supply. They usually have great bulk and low unit value and must be moved from producer to user. Fewer and larger producers often market them directly to industrial users. Because the users depend on these materials, long-term supply contracts are common.
Manufactured materials and parts fall into two categories: component materials (iron, yarn, cement, wires) and component parts (small motors, tires, casting). Component materials are usually fabricated further–pig iron is made into steel, and yarn is woven into cloth. The standardized nature of component materials usually means that price and supplier reliability are key purchase factors. Component parts enter the finished product with no further change in form, as when small motors are put into vacuum cleaners, and tires are put on automobiles. Most manufactured materials and parts are sold directly to industrial users, with orders often placed a year or more in advance. Price and service are major marketing considerations, and branding and advertising tend to be less important.
Capital items are long-lasting goods that facilitate developing or managing the finished product. They include two groups: installations and equipment.
Installations consist of building (factories, offices) and equipment (generators, drill presses, mainframe computers, elevators). Installations are major purchases. They are usually bought directly from the producer, with the typical sale preceded by a long negotiation period.
Equipment comprises portable factory equipment and tools (hand tools, lift trucks) and office equipment (personal computers, desks). These types of equipment don’t become part of a finished product. They have a shorter life than installations but a longer life than operating supplies.
Supplies and business services are short-lasting goods and services that facilitate developing or managing the finished product.
Supply are two kinds: operating supplies (coal, writing paper, pencils) and maintenance and repair items (paint, nails Supplies are the convenience goods; they are usually purchased with minimum effort on a straight re buy basis.
Business services include maintenance and repair services (floor cleaning, computer repair) and business advisory services (legal, management consulting, Advertising). Maintenance and repair services are usually supplied under contract by small producers or are available from the manufacturers of the original equipment. Business advisory services are usually purchased on the basis of the supplier’s reputation and staff.
8. Product Quality:
Product quality is the ability of a product to perform its functions; it includes the product’s overall durability, reliability, precision ease of operation and repair, and other valued attributes. It is one of the marketer’s major positioning tools. Quality has a direct impact on product or service performance; thus, it is closely linked to customer value and satisfaction.
|Product Attributes -> Branding -> Packaging -> Labeling|
Product attributes is very important for every types of products. Because when people know the product attributes at this time they are react good or bad. Then people are inspired and buy the products.
Product quality has two dimensions – level and consistency. In developing a product, the marketer must first choose a quality level that will support the product’s position in the target market. Here, product quality means performance quality – the ability of a product to perform its functions. For example, Unilever Bangladesh Limited launch Manz Active, this product one kind of cream to mans looks fresh, attractive and protect the sun skin.
Beyond quality level, high quality also can mean high levels of quality consistency. Here, product quality means conformance quality – freedom from defect and consistency in delivering a targeted level of performance.
A brand is a name, term, sign, symbol or design, or a combination of these intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors. For example, Manz Active is the products of Unilever Bangladesh Limited. Manz Active is a brand name. Brand products as high quality, expensive product.
Branding has become so strong that hardly anything goes unbranded, even fruits and vegetables.
Packaging activities involves designing producing the container or wrapper for a product. The package includes a products primary packet for the cream. Because this packet is looking nice and write to the product name, logo and integrants etc.
Labels may range from simple tags attached to products to complex graphics that are part of the package. They perform several functions. The label might also describe several things about the product – who, made it, where it was made, when it was made, its contents, how it is to be used, and how to use it safely. Finally, the label might promote the product through attractive graphics. For example, Manz Active your packet labeling graphics is very nice.
9. Advertising And Product Quality Relationship with Sales:
In the business world, poor sales results can be due to any of the marketing mix variables, including product design or quality, packaging, distribution, or pricing. Seven types of different factors affects the sales. Such as – Advertising and Promotion, Competition, Product Quality, Distribution, Technology, Price, The Economy.
Figure: Factors Influencing Sales
Advertising can make consumers aware of and interested in the brand, but can’t make them buy it, particularly if it is not readily available or is priced higher than a competing brand. As shown figure, sales are a function of many factors, not just advertising and promotion. There is an adage in marketing that states “Nothing will kill a poor product faster than good advertising.” Taken with the other factors shown in figure, this adage demonstrates that all the marketing elements must work together if a successful plan is to be implemented.
The effects of advertising often occur over an extended period. Many expert recognize that advertising has a lagged or carryover effects; monies spent on advertising do not necessarily have an immediate impact on sales. Advertising create awareness, interest, and/or immediate favorable attitude toward a brand, but these feelings will not result in an actual purchase until the consumer enters the market for the product, which may occur later. A review of econometric studies that examined the duration of cumulative advertising effects found that for mature, frequently purchased, low – priced products, advertising’s effect on sales lasts up to nine months. Models have been developed to accounts for the carryover effects of advertising and to help determine the long-term effect of advertising on sales. The carryover effect adds to the difficulty of determining the precise relationship between advertising and sales.
They offer little guidance to those responsible for planning and developing the promotional program. The creative and media people working on the account need some direction as to ,the of the advertising message the company hopes to communicate, the intended audience, and the particular effect or response sought. As you will see shortly, communications objectives are recommended because they provide operational guidelines for those involved in planning, developing, and executing the advertising and promotional program.
Many problems in attempting to use sales as objectives for a promotional campaign, there are situations where sales objectives are appropriate. Certain types of promotional efforts are direct action in nature; they attempt to induce an immediate behavioral response from the prospective customer. A major objective of most sales promotion programs is to generate short-term increase in sales.
Direct–response advertising is one of type of advertising that evaluates its effectiveness on the basis of sales. Merchandise is advertised in material mailed to customers, in newspapers and magazines, through the Internet, or by calling a toll–free number. The direct–response advertiser generally sets objectives and measures success in terms of the sales response generated by the ad.
Figure: Direct Response Ads
This is an example of a direct-response advertising message. The direct response advertiser, in this case Skytel, generally sets objectives and measures success in terms of sales response generated by the ad. The effectiveness of the ad can be measured by the number of responses received and whether they result in sales of the product.
Retail advertising which accounts for a significant percentage of all advertising expenditures, is another area where the advertiser often seeks a direct response, particularly when sales or special events are being promoted. The ad for pier 1 import’s back to school sale shown in is designed to attract consumers to stores during the sale period (and to generate sales volume).
Sales–oriented objectives are also used when advertising plays a dominant role in a firm’s marketing program and other factors are relatively stable. For example, many packaged–goods companies compete in mature markets with established channels of distribution, stable competitive prices and promotional budgets, and products of similar quality. They view advertising and sales promotion as the key determinants of a brand’s sales or market share, so it may be possible to isolate the effects of these promotional mix variable. Thus, many companies believe it is reasonable to set objectives and evaluate the success of their promotional efforts in terms of sales result.
Advertising and promotional programs tend to be evaluated in terms of sales, particularly when expectations are not being met. Marketing and brand managers under pressure to show sales results often take a short-term perspective in evaluating advertising and sales promotion programs. They are often looking for a quick fix for declining sales or loss of market share. They ignore the pitfalls of making direct links between advertising and sales campaigns, as well as ad agencies, may be changed if sales expectations are not being met. As discussed in Chapter 3, many companies want their agencies to accept incentive-based compensation systems tied to sales performance. Thus, while sales may not be an appropriate objective in many advertising and promotional situations, managers are inclined to keep a close eye on sales and market share figures and make changes in the promotional program when these numbers become stagnant, or decline.
Finally we are know Objectives, Marketing, Sales Promotion, IMC, Advertising, Classification of Advertising, Major Media Types, Product, Product Classification, Durability and Tangibility, Consumer – Goods Classification, Industrial – Goods Classification, Product Quality and Advertising and Product Quality Relationship with Sales.